Gold has been proving its worth since antiquity
Since the beginning of human civilization, gold has been one of our most valuable materials. It’s a finite resource that probably came to Earth via asteroid showers several billion years ago. This rarity explains why gold is the only form of currency that has kept its value over thousands of years.
“Gold is money. Everything else is credit.”
– J.P. Morgan, 1912
Why buy gold? Physical gold cannot default on promises and is the only form of real currency. For centuries, investors have sought out physical gold because they recognize that physical gold is able to weather the storms of inflation, currency fluctuations, market collapses, and political unrest far better than paper currency or other assets can.
Here are 10 reasons you should invest in gold today
Increasing demand: From private investors to hedge funds and from central banks to governments, we’re seeing a significant and increasing demand for gold. Demand has been particularly strong in recent years—wealthy emerging-market economies like India and China, along with most central banks across the world, are stocking up on gold to protect themselves from the pitfalls of the global excess of paper currencies.
Scarcity: If we took all the gold ever mined and melted it down, it would fit within an Olympic-size swimming pool. That’s how rare it is. If you then learn that production has been in decline since 2000, and that there may be only 20 years of mineable reserves left, you can see why gold is an asset that’s guaranteed to retain its value for generations to come.
Privacy: Your gold is your business! When you choose to buy physical gold or other precious metals and hold them with Gold Alliance, none of your information is shared with any public or private entity.
Gold is seriously undervalued: Analysts predict that the amount of paper money printed by central banks in recent years will result in hyperinflation, destroying the purchasing power of the US dollar. And that’s not all: The ratio of the gold price to the stock market price is at a historic low because only 1% of investments worldwide are in gold.
Still asking yourself “Why should I buy gold?” Here are some more reasons to buy gold:
• Hedge against inflation
• Hedge against deflation
• Protection from stock market volatility
• Gold price remains stable against geopolitical uncertainty
• ETFs vs. physical gold
Diversification: Your portfolio will benefit from diversification, a simple risk management technique that mixes a wide variety of investments that aren’t closely correlated to one another. This technique will smooth out the performance of your portfolio when the positive performance of some investments neutralizes the negative performance of others. Historically, gold has had a negative correlation to stocks and other paper-based financial instruments, making it an ideal choice for those wanting to diversify and protect their portfolios in volatile times.
Hedge against inflation: Many people buy gold to protect their portfolio from inflation and the declining value of the US dollar. Gold prices soar when stock markets plunge, and the cost of living increases. Having precious metals in your IRA is, therefore, a surefire way to safeguard your money from inflation’s financially destructive effects.
Hedge against deflation: When prices decrease, and the economy grinds to a halt, the price of gold keeps on rising. Fortunately, we haven’t seen a global depression since the Great Depression of the 1930s. The Depression taught us one golden lesson: Gold’s purchasing power goes through the roof when the US dollar and other investments sharply drop.
Protection against the volatile stock market: People talk about playing the stock markets, but your retirement fund isn’t there to be played with. When stock markets plummet, retirement accounts invested in stocks plummet with them, forcing you to keep on working for many years. What is the best way to avoid this? Take charge of your own retirement protection by diversifying your portfolio with precious metals.
The gold price remains stable against geopolitical uncertainty: It’s for a good reason people call gold the “crisis commodity.” With the US election and Brexit sending political shockwaves across the globe, gold prices have soared, clearly outperforming other investments.
ETFs vs. physical gold: There’s growing concern among financial experts that issuers of financial paper products invested in gold (exchange-traded funds) don’t own the amount of gold they claim to. In fact, more than 100 times more gold is sold via ETF certificates than there is physical gold held by the certificate issuers. How will an ETF back up its obligations to its investors during a running inflation? The experts suggest you should diversify into gold by investing in physical gold that you own in your own name, and that cannot default.
For these reasons and more, you should invest part of your portfolio in physical gold. Contact us to learn more or read our companion page Why Invest in Silver?